Hot Stove Contracts: Incorporating Time Value of Money into MLB Free Agent Analysis

Mega sporting events typically justify their use of public funds through pre-event estimates of economic impact. Super Bowl 50, hosted in the San Francisco Bay Area in 2016, took a different approach. The Host Committee intended to redefine how a Super Bowl is hosted, by making SB50 the most giving, shared, and participatory Super Bowl ever. This case follows Host Committee chairman Daniel Lurie’s attempt to evaluate the economic and social impact after the event, presenting a wide range of data and perceptions from both event proponents and detractors. Together, students will estimate financial gains and cost, net economic impact, and evaluate social impacts. Ultimately, students are forced to critically analyze the degree to which economic and social impacts can be compared and contrasted, leading to a manager’s assessment of the overall benefit or cost to a host city.

For nearly a century, owners of U.S. professional sports teams have lobbied respective governmental bodies for public subsidies to build stadiums and arenas across the country, using franchise relocation as leverage. Myriad justifications have been used as a defense for the public subsidization of this private enterprise, ranging from the economic impact of capital intensive projects to the psychic regional benefit of being a host city to a professional sports franchise. But do these justifications hold up under increased scrutiny? In this case, students are placed in the position of the Mayor of Oakland as she is faced with a dilemma regarding publicly subsidizing a new Raiders stadium. Students will examine the issue through the lens of multiple key stakeholders, and will ultimately have to decide whether the city should utilize public funds to keep the Davis family happy and the Raiders in Oakland, or withhold funding for public good and risk the franchise relocating elsewhere.

While some believe that managers generally operate under one distinct style of leadership, research has revealed that most successful leaders can shift between six styles of leadership in order to foster an optimal organizational climate. These styles can be used in different environments, and are spotlighted in this case as students are presented with contextual evidence of leadership styles from the sports industry. While reviewing six sport leaders, from commissioners to coaches to media executives, students will work through leadership typology and think critically about purposeful strategies to improve organizational behavior.

Written by the MLBPA's former Director of Communications Greg Bouris, this case takes students inside the history of communications challenges relative to smokeless tobacco usage in professional baseball. The case examines a myriad of stakeholders involved in the private, and public, messaging surrounding this 'hot button' issue, from players, to public advocacy groups, to teams, to Commissioner Bud Selig and the United States Congress. With careful consideration of the nuances surrounding collective bargaining and the underlying legal framework binding the league to its labor union, the case demonstrates how a communications team should tactfully manage a complex issue amidst changes to policy, public sentiment, and labor positioning. After absorbing the theory and facts of the case, students are tasked with drafting strategic position statements written at varying points of time within the overall case timeline.